The 30% Ruling in the Netherlands: An Expat's Overview

What is the 30% Ruling?

In 2026, the Expat Scheme allows an employer to pay up to 30% of an eligible employee's salary, including the allowance, tax-free. The employer is not obliged to pay the full percentage, and the remaining taxable salary must satisfy the applicable salary norm. This reimbursement is intended to cover the "extraterritorial costs" (e.g., relocation, dual housing, additional living expenses) that foreign employees often incur when moving to and working in the Netherlands.

It essentially means that for eligible employees, a substantial portion of their income is exempt from Dutch income tax, making the Netherlands an attractive destination for international talent.

Who is it For? Highly Skilled Migrants

The 30% ruling is specifically targeted at highly skilled migrants who are recruited or seconded from abroad to work in the Netherlands. The primary aim is to attract and retain specialized foreign workers whose expertise is scarce in the Dutch labor market.

It's not automatically granted; both the employee and the employer must apply for it together, and strict conditions must be met. This tax decision is separate from an immigration permit; it does not itself give you permission to live or work in the Netherlands.

Main Benefits of the 30% Ruling

Beyond the obvious tax-free reimbursement, the 30% ruling offers several other significant advantages:

• Reduced Taxable Income: The primary benefit is the 30% tax-free reimbursement, directly increasing your net income.
• Partial Non-Resident Tax Status: Transitional Cases Only: This option was abolished from the 2025 tax year. If you used the Expat Scheme before 2024 and meet the transitional conditions, you can still elect it through the 2026 tax return. It affects Box 2 and Box 3, not Box 1. New recipients cannot claim it simply because they have a 30% ruling.
• Easier Driving License Conversion: Expats with the 30% ruling can convert their foreign driving license to a Dutch one without needing to take a new driving test, regardless of the issuing country, provided RDW's other exchange conditions are met. A valid tax decision and, where required, a CBR health declaration are needed.
• International School Fees: An employer may also reimburse qualifying international-school fees tax-free in addition to the Expat Scheme allowance.

Key Eligibility Requirements

To qualify for the 30% ruling, certain strict conditions must be met:

• Recruitment from Abroad: You must have been recruited outside of the Netherlands and have moved to the Netherlands for your job.
• Specific Expertise / Salary Norm: You must possess specific expertise that is scarce or not available on the Dutch labor market, demonstrated by meeting a taxable salary norm after the allowance. In 2026 this is more than €48,013, or more than €36,497 for qualifying employees under 30 with an academic master's degree. Designated scientific researchers and doctors training as specialists have an exception.
• Distance Requirement: You must have lived more than 150 kilometers from the Dutch border for more than 16 of the 24 months prior to your first working day in the Netherlands. Special rules apply to some returning employees and PhD graduates.
• Valid Employment Contract: You must have a valid employment contract with a Dutch employer.

For a detailed examination of these criteria, please refer to our dedicated article: 30% Ruling Eligibility Criteria.

2026 Limits and the Change from 2027

For a full year in 2026, the allowance is capped at €78,600, based on a maximum salary of €262,000. A part-year allowance has a proportionately lower cap. Decisions last up to five years, with previous residence or work potentially reducing that period.

From 2027 the maximum percentage becomes 27% for employees who first used the scheme in 2024 or later. Employees who used it by 31 December 2023 retain 30% under the transitional rules. A higher salary norm applies from 2027 to employees who started using the scheme from 1 January 2025; check the published norm for that year.

Official Sources

Tax rules and licence-exchange conditions checked on 27 September 2026:

• Belastingdienst: Expat Scheme eligibility, 2026 limits and partial non-resident transition
• Rijksoverheid: 2027 changes and transitional rules
• RDW: exchanging a foreign driving licence